Site Mobile Navigation

Economic 'Flu' Isn't Asia's Alone

You should consider dropping the ''Asian flu'' metaphor from accounts of the financial crisis (''Many Players, Many Losers,'' Business Day, Dec. 10).

To suggest that a mysterious virus is to blame seems culturally condescending and is also wrong. This debacle originated in New York as well as in Jakarta, Bangkok, Seoul and Tokyo.

A more accurate metaphor would evoke psychological disorder. It afflicted global bankers and financiers, both American and foreign. Their lending and investing gradually became unhinged from the economic reality, as soaring returns fostered delusions of invincibility. This binge ended abruptly, as manias do. Their borrowers are smashed. Naturally, the lenders are depressed.

The United States and the International Monetary Fund propose to make them feel better by rescuing those creditors from their mistakes. Our United States credit (and tax money) will replenish failed borrowers so that they can pay back the notes held by our worried bankers. So bankers will start lending to them again. This is a bizarre approach to therapy; it rewards the patient for his own reckless illusions.

I do observe one form of ''contagion'' in the present crisis. It's a virus called self-doubt, which appears to be spreading among the usual cheerleaders for global finance. This is a healthy sign for the rest of us.